I’ve been fascinated by crypto for quite a while now due to the real world utility that it brings. However, I often hear the sentiment repeated that crypto does not have any real world use cases. This is surprising to me, so I want to share some of my thoughts on this. In this article, I show that there are already many uses for the technology that often are overlooked.

Self custody

The modern banking system is broken and is designed to steal money from everyday people. Traditionally, banks were the only alternative one had to keep their money safe. It was foolish for someone to keep their entire life savings under their bed or in a pillow. This meant that users had no alternative and had to store their funds in the bank to keep them safe.

However, when users deposit their funds in banks, it is impossible to know what exactly is being done with those funds. One recent example of this was with Silicon Valley Bank (SVB) which was unable to provide funds to their users during a cash crunch, because the funds had all been invested in long term bonds. Even though it was the users funds, they couldn’t even directly get access to those bonds since the bonds were owned by the bank. The users had effectively given up ownership of their money and kept a lot of trust in the banking institution. To resolve this issue, a massive relief had to be provided by the government from taxpayer funds to guarantee the deposits.

One can also look at the example of FTX. FTX from the outside looks like a crypto company, but in reality it operated exactly like banks do. If it walks like a duck, talks like a duck and all that. FTX used user funds in risky trades, eventually losing all of those funds. Over $40B of user funds were lost and most of these users that were affected will likely never get their money back.

Cryptocurrency solves these banking problems by providing a secure infrastructure where users no longer need to rely on the banking systems. Instead, user funds are secured using powerful mathematical tools. User funds are guaranteed to only be accessible by the owner of those funds. For the first time in history, we have a system where value can be stored without having to rely on the banking system.

Transferring funds

Traditionally, sending funds between users has been a cumbersome and time consuming process. To send funds overseas, users have to go through banks using a process that can take several days. The banking system also cheats users by charging significant fees and providing unfavourable exchange rates. Additionally, there is sometimes human error involved when sending these transfers through banks since there is a lot of manual labour involved.

Cryptocurrency solves all of these issues as well. On ethereum, it takes seconds to send any amount of money to anyone on earth. Additionally, the transfer can be done for a few dollars - or even a few cents by using Layer 2 systems. Everything from splitting the cost of a meal to sending money back home to family can be done more seamlessly than ever before.

Exchanging currencies on decentralized finance applications has revolutionized currency exchange. These platforms automatically provide fair exchange rates that exactly match the market rate in a transparent manner. Fees from the protocol are distributed fairly to protocol participants who provide liquidity for making exchanges. This is a technique for making yield that was previously only available to banking elites. Now, a fair market is created where anyone can provide a service that anyone else has access to.

Separation of government and money

For a significant period of human history, it was common for the government to be intertwined with religion. In the Roman Empire for example, the state could deem it illegal for citizens to believe certain religions and preach about them. Depending on the religious beliefs of those in power, those beliefs could be forced on anyone who lived in the empire. This was an extremely common form of government until Henry VIII, like an absolute chad, broke away from the catholic church so that he could get a divorce.

This ideal of removing state control from something so deeply personal like religion has been absolutely positive. In the first amendment of the United States constitution, this beautiful ideal was put into law. This way, the government is unable to intervene in the religious affiliations of anyone living in the country. If we are able to remove the government from our personal lives, maybe it’s time to take them out of our financial lives as well.

What I mean by this is that governments abuse their power of control over the monetary supply to their own benefit. Those in power print money and devalue the currency that is held by the masses. Since there is no cap on how much the government can spend, corrupt institutions are able to earn huge amounts of money while making the rest of society poorer. One example of this is the military industrial complex. President Eisenhower discusses this in his farewell address.

The potential for the disastrous rise of misplaced power exists, and will persist. We must never let the weight of this endanger our liberties or democratic processes

I believe money belongs to the people, not the state. Cryptocurrency enables all of us to take back control of our money and disable the state from devaluing it through systemic corruption.

Censorship free social media

After the January 6 2021 storming of the US capital, president Donald Trump was swiftly banned from all the major social media platforms. I don’t intend to make a political stance, however, it is clear that social media companies are too powerful. The fact that unelected elites have the ability to completely remove the sitting president of the United States is absurd.

Other examples of this can be seen with the handling of the covid pandemic by these same social media platforms. Ideas that were deemed unacceptable were directly removed from public conversation such as the Wuhan lab leak theory. Our communication channels have become politicized and believing the wrong thing can get you kicked off. This is very similar to the issues of linked church and state that I discussed earlier.

Using crypto technology, social media platforms such as lens and farcaster have been developed where a user’s content is entirely owned by them. Instead of being completely at the whims of whoever owns the platform, users own their content and their followers go with them to any platform.

Final thoughts

Crypto already has many effective use cases that are often overlooked. The technology brings significant improvements to the lives of everyday people. Never before have ordinary people been able to control their own financial lives and online freedom than today. This has only scratched the surface on what is possible and how far this industry can go.

Credit to Linh Nguyen on Unsplash for the header photo